EU to set up ‘stability reserve' that will automatically withhold or add allowances at set price levels. The European Commission today put forward a legislative proposal to change the design of the EU's Emissions Trading Scheme (ETS) after 2020, in hopes of creating a long-term fix to the problem of a chronically low price of carbon.
The reform would establish an automated ‘stability reserve' which would withhold carbon credits from the market when needed. This would be triggered when the total number of allowances in circulation in a given year is below 400 million. In that instance 100 million allowances would be automatically released from the reserve...............................................Full Article: Source